Amazon: the brain inside the IoT?

Amazon this week announced it will push deeper into the smart home market by selling semiconductors from a chip design company it purchased last year for $350 million. The chips from Annapurna Labs will sell to home equipment designers that build products for the Internet of Things.

Advertising and media executives may not realize that these ARM-based silicon chips act as the brain for IoT devices. The brain automates functions, similar to the way advertising platforms buy and bid on ad placements. The chips are used by original equipment manufacturers that build network-attached storage, WiFi routers, and streaming media, among other devices. These programmable chips have the ability to search and pull in data, serve or save information, and connect with other devices.

Amazon’s decision will see companies integrate search into a variety of hardware devices.

This week we learned of Amazon’s new product line, Alpine, that will serve as a foundation for next-generation digital services for the connected home, according to a press release.

The chips can enable functions such as voice search in a device. Voice search will drive new behavior and understanding for marketers in 2016, according to David Pann, GM of Microsoft Search Advertising, who made seven search predictions for 2016. Pann’s predictions range from using search data to predict the outcome to using paid-search advertising to go beyond keywords to audience and action buying, and mobile to personalize the experience.

Search marketing will harness the majority of digital marketing spend, predicts Pann, but the industry will need to find a way to automate more functions into chips and devices.

Search marketing will represent 45.4% of digital marketing spend in 2016, per Forrester Research Digital Marketing Forecasts, 2014 to 2019 (US). That likely doesn’t include future search investments that will become automated in devices.

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